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North and South Korea to reopen joint industrial park

North and South Korea have agreed to reopen their combined industrial park in Kaesong. The business zone was closed in April amid tension between the two nations.

The agreement to resume operations at the Kaesong industrial area, which lies 10 kilometers (6.2 miles) within North Korea's heavily fortified borders, was reached on Wednesday. However, no date was given for when it would reopen.

After the breakthrough was announced, South Korea sounded a note of caution.

"This agreement is not an end but only a beginning," Seoul’s chief delegate Kim Ki-Woong told reporters. "What's more important is how both Koreas can implement the agreement," Kim added.

The five-point agreement, signed by Kim and his North Korean counterpart, Park Chol Su committed both sides to making "active efforts" to resuming normal operations as soon as possible once the facility was inspected.

The factory park shut down in April when Pyongyang pulled out its 53,000 workers, as it made threats of war and nuclear strikes on Washington and Seoul. The last of the South Korean managers left in May. Since then, six previous rounds of talks had failed.

"The South and the North will prevent the current suspension of the Kaesong industrial complex caused by the workers' withdrawal from being repeated again," the agreement said.

Repairing economic damage

The industrial park, a rare symbol of cooperation between North and South Korea, was established in 2004 to combine the capital and technology of the South with labor from the North, to benefit both nations.

A copy of the accord released to reporters said a joint committee would be set up to discuss compensation for economic losses suffered as a result of the four month closure.

The seventh round of talks was proposed by North Korea last week; hours after Seoul declared it would launch a compensation package totaling $250 million (189 million euros) to affected South Korean businesses. The move was widely seen as a first step towards Seoul abandoning the zone.

Military exercises

The Korean Peninsula has been divided for the past 60 years, when an armistice was signed to end the Korean War. No official peace deal ever followed the truce.

The agreement comes a day before both Koreas are due to celebrate their independence from Japan, which ruled the peninsula between 1910 and 1945 and raised hopes of a possible improvement in political ties between the two Koreas.

It also comes as the United States and South Korea prepare for their annual joint military drill, in which they practice what would happen if North Korea invaded.

North Korea views the operations as hostile and cited previous joint exercises earlier this year as a main trigger for the closure of the complex.